Three groups of creditors announced on Monday they had rejected Argentina's proposal to restructure 66 billion U.S. dollars of debt and have made a counteroffer to President Alberto Fernandez's government.

"Argentina's offer is short of what the creditor groups can accept," said the creditors in a statement, adding that they would not meet the government's August 4 deadline to find an agreement.

However, the creditors expressed confidence that an "agreed solution" could be found that insures "the future economic sustainability for the Argentine people."

Argentina's latest offer, issued under foreign law, was worth 53.5 cents on the dollar, a significant improvement on its original starting position of 39 cents.

Having originally proposed a three-year grace period, the latest offer reduced that to one, with repayments beginning in September 2021.

The Exchange Bondholders, Ad Hoc and Argentina Creditor Committee groups that issued the statement claim to represent a third of bondholders under foreign law involved in the restructure talks. 

That gives the groups veto power over any restructure deal, experts say.

The groups did not divulge any details about their counter offer.

The bonds represent roughly a fifth of the country's 324 billion U.S. dollars debt, which amounts to around 90 percent of its GDP.

In recession since 2018, the Argentine economy has been further punished by the coronavirus pandemic. The International Monetary Fund estimates it will contract by 9.9 percent this year.

With the backing of the IMF, Fernandez has insisted that any deal with creditors be sustainable so that the country can meet its obligations over the long term.